Overview

Post-World War II Greece saw rapid economic and social change, with tourism and shipping becoming major contributors to the economy.

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The financial crisis of the late 2000s hit Greece particularly hard, as the legacy of high public spending and widespread tax evasion combined with the credit crunch and the resulting recession to leave the country with a crippling debt burden.

In the spring of 2010, amid fears of an imminent default on debt payments and of the debt contagion spreading to other countries, Greece's fellow eurozone countries agreed an unprecedented 110bn euro package to rescue its teetering economy. The main condition attached to the loan - drastic cuts in public spending and tax hikes - prompted protracted social unrest.

Parthenon, Athens: Built at the apex of the city-state's power

The 2010 rescue package soon proved to be unequal to the task of plugging the hole in Greece's finances, and the following year an even bigger bailout of 130bn euros was required to stave off the imminent danger of the country defaulting on its debts.

Greece has long been at odds with its close neighbour, Turkey, over territorial disputes in the Aegean and the divided island of Cyprus.

Relations warmed after both countries suffered earthquakes in 1999 and offered each other practical help.

Although the disputes remain unresolved, the Greek government gives strong backing to Turkey's EU bid. It sees dividends to be gained from the increased regional stability that it believes membership would bring.

Greece has been in dispute since the early 1990s with the Former Yugoslav Republic of Macedonia. Greece contends that the use of the name Macedonia by the neighbouring country implies a territorial claim over Greece's own region of the same name. The UN is involved in continuing mediation efforts.

Athens stepped into the global spotlight when the Olympic Games returned home in 2004. The games were hailed as a success, despite widely publicised fears that the infrastructure would not be complete in time.

Leaders

Born in 1929, veteran Pan Hellenic Socialist Movement (Pasok) foreign minister Karolos Papoulias was elected president by parliament in 2004, and again for a final five-year term in 2010.

The presidency is a largely ceremonial post, as executive power resides with the prime minister.

Interim prime minister: Lucas Papademos

Lucas Papademos became interim prime minister in November 2011 following days of talks between the parties seeking to form an interim government of national unity to steer the country out of the acute political crisis triggered by Greece's long-running debt crisis.

Lucas Papademos: the man with the most difficult job in Europe?

His administration is a coalition of the Socialists (Pasok) of his predecessor George Papandreou, the centre-right New Democracy party and a small party of right-wing populists (Laos).

A technocrat and political independent, Mr Papademos had previously acted as an adviser to Mr Papandreou, taking part in the bailout negotiations between Athens and the "troika" of international creditors - the IMF, the European Commission and the European Central Bank (ECB).

He has long played a leading role in economic affairs, having served as head of the Bank of Greece from 1994 to 2002 and vice-president of the ECB from 2002 to 2010.

In the former capacity, he oversaw Greece's transition from the drachma to the euro in 2002.

His biggest challenge in his current role is to reassure the markets that the coalition government will honour its pledges to tackle tax evasion and bring greater transparency to public finances.

Above all, he needs to convince Greece's creditors that his government will respect the terms of the latest EU bailout plan reached on 27 October and push through the further austerity measures demanded as the price of the next tranche of the international loan that the country needs in order to stave off bankruptcy.

Mr Papademos was born in Athens in 1947 and attended university in the US, studying physics and electrical engineering before switching to economics.

He taught economics at Colombia University from 1975 to 1984, after which he returned to Greece and became chief economist of the Bank of Greece, going on to become the bank's governor in 1994.

In this role, he was strongly in favour of the single currency, arguing that the potential benefits to be derived from the introduction of the euro were enormous.

Critics say that he should have been in a position to know of inaccuracies in Greece's budget figures in the run-up to joining the euro, a charge he has dismissed.

During his time at the ECB, he was seen as a strong advocate of fiscal and budgetary discipline, sharing the view of his boss, Jean-Claude Trichet, that the ECB should not play a large role in bailing out highly indebted eurozone governments.

Broadcasting is relatively unregulated by European standards, and many of the approximately 1,700 private radio and TV stations are unlicensed.

The media enjoy considerable freedom. However, Reporters Without Borders in 2009 warned of a growing trend of violence against the media and death threats against journalists. It said these were often claimed by anarchists and extreme leftists.

There were nearly 5 million internet users by mid-2010 (Internetworldstats).

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